KUALA LUMPUR (May 27): Shares of OldTown Bhd jumped 9.03% this morning after JF Apex Securities Research upgraded OldTown to “Buy’ with a higher target price of RM1.63 (previous: RM1.50) based on FY17 EPS forecast of 13 sen (previous 11.6 sen) with 12.5x blended industry PER.

At 9.40am, OldTown rose 13 sen to RM1.57 with 319,300 shares done.

In a note today, the research house said its target price denotes an upside potential of 13% from its closing price of RM1.44.

JF Apex said OldTown’s 4QFY16 net profit jumped 65.8% q-o-q and 80.4% y-o-y to RM18.36 million.

Meanwhile, 4QFY16 revenue stood at RM104.52 million, rising 2.3% q-o-q while slightly declining by 0.5% y-o-y.

The research house said that for 12MFY16, net profit was registered at RM52.27 million, which increased by 10.1% y-o-y.

It said that in contrast, revenue decreased marginally by 1.1% y-o-y to RM393.41 million.

“12MFY16 net profit was above expectations by accounting for 119%-118% of our full year earnings forecast and market consensus respectively thanks to continuous pretty growth by FMCG segments in addition of cost saving initiatives by the group.

“We maintain our positive view on the group’s FMCG division as we foresee this segment will continue to expand banking on management efforts to strengthen its marketing initiatives for local and overseas markets especially the ongoing branding to drive growth and demand for the white coffee segment.

“We foresee the growth trajectory on export sales to sustain in coming years to benefit the group,” it said.